Knight Frank payouts fall as profits dip

ESTATE agent Knight Frank yesterday insisted it was looking ahead to a &ldquo;period of stability&rdquo; after revealing a&nbsp; near 50&nbsp; per cent fall in full-year pre-tax profits.<br /><br />The group, which advised on Nomura&rsquo;s move to Watermark Place &ndash; the City&rsquo;s biggest property deal this year &ndash; revealed underlying group profits had fallen to &pound;33.2m in the year ending 30 April 2009, down from &pound;67m the year before.<br /><br />Chairman and senior partner Nick Thomlinson told City A.M: &ldquo;To say the last 12 months have been difficult is an understatement. But we reacted quickly to the problems and took a lot of the fat out of the cost base.&rdquo; <br /><br />Despite the economic turmoil crippling the property market in the downturn the group managed to maintain net assets of &pound;58.3m, down from the &pound;76.2m the year before, and remains debt free with &pound;28.5m net cash in the bank, down from &pound;53.9m.<br /><br />Last year the group came under fire for awarding an average payout of &pound;780,000 per partner, despite the market slump. In the boom times Knight Frank&rsquo;s partners enjoyed awards of over &pound;1m.<br /><br />But in the strongest indication of how property agencies have fared in the downturn, the group said the average pay out per proprietary partner had dropped to &pound;169,000.<br /><br />Thomlinson said: &ldquo;It&rsquo;s absolutely right that partners bear the brunt of the downturn.&rdquo; He added that the fall in profits and the increase in the number of partners from 46 to 61 also meant pay outs were divided between more people.<br /><br />The group issued a cautious outlook on the commercial property sector, warning that it could take until 2012 for rents to rise again. It added that house prices &ldquo;are starting to bottom out across the world&rdquo;.